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WHY MICHIGAN CAR ACCIDENT VICTIMS NEED UNLIMITED PERSONAL INJURY PROTECTION (PIP) BENEFITS

Published by Bill Laubscher at April 14, 2023

Jar full of coins with the words medical expenses written on the front of the jar

Personal Injury Protection (PIP) benefits are the cornerstone of the Michigan No-Fault system. If you or your passengers are injured in an auto accident, this coverage pays for medical expenses, lost wages, and other related costs regardless of who was at fault. While unlimited PIP benefits used to be part of every Michigan No-Fault policy, recent changes to the law provided new options with reduced PIP coverage.

Although saving a few dollars on your premium sounds tempting, recovering from a crash with inadequate medical insurance can be disastrous, physically and financially. Here is an overview of why drivers need unlimited PIP benefits in the event of a Michigan car accident.

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WHAT IS PERSONAL INJURY PROTECTION (PIP) COVERAGE?

Personal Injury Protection (PIP) benefits are a mandatory part of every Michigan No-Fault policy. If you are injured in an auto accident, these are the benefits that cover medical care and related expenses such as rehabilitative therapy and attendant care, in addition to lost wages and replacement household services. These direct costs are also known as first-party benefits.

Michigan No-Fault insurance policies also include Personal Property Protection (PPI) benefits. This coverage typically pays up to $1,000,000 for damage to other people’s property or legally parked vehicles.

Here is a summary of the coverage provided under the Personal Injury Protection (PIP) portion of a No-Fault policy:

Reasonable and necessary medical and rehabilitative expenses related to injuries sustained in the accident (up to the coverage limits of the policy)
Mileage or transportation to and from medical appointments related to the accident, including rehabilitative therapy (up to the limits of the policy)
In-home attendant care (up to the limits of the policy)
Home modifications (up to the limits of the policy)
Case management services (up to the limits of the policy)
Guardianship/conservatorship expenses (up to the limits of the policy)
85% of lost wages up to the statutory monthly limit (currently $5,452/month) for a maximum of three years
Household replacement services up to $20/day for a maximum of three years
If the insured person dies as a result of the accident, benefits are provided to the surviving dependents for loss of income up to the statutory monthly maximum for up to three years

HOW DID THE RECENT NO-FAULT REFORMS AFFECT PIP COVERAGE FOR MICHIGAN DRIVERS?

In 2019, Michigan legislators passed a series of significant reforms to the No-Fault system. The most noteworthy change concerned Personal Injury Protection (PIP) medical coverage. Previously, every No-Fault policy included unlimited PIP coverage, which made Michigan auto insurance rates among the highest in the country. Under the new law, which took effect July 1, 2020, policy holders could choose one of six PIP medical coverage options ranging from unlimited PIP benefits to no coverage (for those enrolled in Medicare Parts A and B).

While the new PIP benefit options reduced premium costs, they imposed strict limits on coverage for medical care and related expenses. As a result, choosing a lower level of PIP coverage could result in staggering medical bills for someone who is seriously injured in a Michigan car accident.

WHAT ARE THE SIX PERSONAL INJURY PROTECTION (PIP) OPTIONS?

As of July 1, 2020, Michigan No-Fault includes six levels of Personal Injury Protection (PIP) medical coverage. Policy holders, including those on Medicare, can select one of the following options for PIP medical benefits:

Unlimited lifetime coverage of “necessary and reasonable” medical services, including attendant care
$500,000 limit for PIP medical coverage
$250,000 limit for PIP medical coverage
$250,000 limit with the option to exclude themselves, a spouse or relative living in the same household, providing that person has their own qualified health insurance (other than Medicare or Medicaid) that covers injuries resulting from auto accidents
$50,000 limit for PIP medical coverage (Medicaid recipients only)
No PIP medical coverage (must be enrolled in Medicare Parts A and B)*

The above options pertain to medical benefits only; coverage for lost wages and replacement household services were not affected by the 2019 reforms.

*Medicare does not pay for many services covered by unlimited Personal Injury Protection (PIP) medical benefits, such as in-home attendant care and long-term custodial care, so Medicare recipients would be wise to consider adding PIP coverage to their policy.

WHY ARE UNLIMITED PIP BENEFITS IMPORTANT AFTER A MICHIGAN CAR ACCIDENT?

Unlimited PIP medical coverage provides the highest level of protection available to Michigan drivers. In the event of a serious accident, these comprehensive lifetime benefits cover all necessary medical expenses, including hospital stays, surgeries, rehabilitation, medication, attendant care and more.

Insufficient medical insurance can result in devastating medical bills or denial of necessary treatment or procedures. In fact, a study by the U.S. Census Bureau found 19 percent of households have medical debt. Choosing unlimited PIP medical coverage provides peace of mind and comprehensive protection that is well worth the additional cost.

CAN I LOWER PREMIUM COSTS WITHOUT REDUCING PIP COVERAGE?

Yes. Everyone wants lower premiums, but decreasing PIP benefits can cost far more in the long run if you or a loved one is seriously injured in a crash. Instead, consider reducing premium rates by raising your deductible or eliminating collision and comprehensive coverage, especially on older vehicles. Some insurance companies give discounts for low mileage or good driving records.

Rates can vary considerably, so it pays to shop around and compare prices from different insurance providers. If you find a lower rate, make sure it includes the same coverage as your current policy. And be wary of insurance agents who recommend saving money by reducing PIP benefits or liability coverage.

CONTACT ONE OF OUR EXPERIENCED MICHIGAN CAR ACCIDENT LAWYERS TODAY

If you or a loved one is injured in a Michigan traffic accident, we can help. Our experienced lawyers have the skills, knowledge and resources to win the compensation you and your family deserve.

Car accident law is complicated, but finding the right Michigan auto accident attorney is simple.

Don’t let the legal clock run out. Start your case today by clicking on the link below or calling 1-800-CALL-SAM for a free, no-obligation consultation with a member of our legal team.

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